Topics: News, What's New from the Charities Directorate of CRA, Canadian Charity Law, Ethics and Canadian Charities, Avoiding 'Charity' Scams
I wish it was an April Fool’s joke but unfortunately there are still Canadians investing in the ‘abusive charity gifting tax schemes’. The Globe and Mail had an article today by Paul Waldie discussing “New Canada Revenue rules target charitable tax shelters”. The article discusses a measure in the 2013 Federal Budget dealing with donation tax shelters. Over the last decade over $6 billion in receipts have been issued as part of abusive charity gifting tax schemes. As a result billions of dollars have either not been collected or have been delayed in collection. The CRA has been winning these cases (for example Marechaux) and now the CRA will be given an increased ability to collect funds on disputed amounts related to donation tax shelters. In the past CRA could not collect until the process was completed (sometimes 10 or more years later). Now CRA can collect on 50% of potential taxes if CRA disputes the charity donation tax shelter. If the taxpayer wins they would get their 50% back. This just makes these schemes a little less attractive. It also reduces the likelihood of someone trying to avoid a large amount of taxes and then skipping off to Bermuda or Panama or wherever people skip off to these days.
Here is a link to the article:
“New Canada Revenue rules target charitable tax shelters” by Paul Waldie
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Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.